Market close: Nifty 50, Sensex extend losses into second consecutive session; investors lose over ₹2 lakh crore in a day
Nifty 50 ended the day at 19,436.10, down 93 points, or 0.47 per cent, while the 30-share pack Sensex closed with a loss of 286 points, or 0.44 per cent, at 65,226.04.
Nifty 50 today: Frontline indices the Nifty 50 and the Sensex ended in the red on Wednesday, October 4, extending losses into the second consecutive session, amid a sharp rise in the US bond yields and dollar.
Bond markets are witnessing a strong selloff globally, causing yields to rise sharply.
"An unrelenting selloff in world government bond markets pushed US 30-year Treasury yields to 5 per cent for the first time since 2007 and Germany's 10-year borrowing costs to 3 per cent on Wednesday, moves that could hasten a global economic slowdown," reported Reuters.
Additionally, caution ahead of the monetary policy outcome kept the market low. The RBI (Reserve Bank of India) MPC (monetary policy committee) meeting is underway and its outcome is due on Friday (October 6). Investors await what the central bank has to say about inflation trajectory and economic growth.
Nifty 50 started the day at 19,446.30 against the previous close of 19,528.75 and fell about a per cent to hit its intraday low of 19,333.60. The Sensex opened at 65,330.65 against the previous close of 65,512.10 and declined nearly by a per cent to the intraday low of 64,878.77.
Nifty 50 finally ended the day at 19,436.10, down 93 points, or 0.47 per cent, while the 30-share pack Sensex closed with a loss of 286 points, or 0.44 per cent, at 65,226.04.
Mid and smallcaps underperformed the benchmarks as the BSE Midcap index closed with a solid loss of 1.52 per cent while the BSE Smallcap index dropped 0.96 per cent.
The overall market capitalisation (mcap) of the firms listed on the BSE dropped to nearly ₹316.7 lakh crore from ₹319.2 lakh crore in the previous session, making investors poorer by about ₹2.5 lakh crore in a day.
Both, the Sensex and the Nifty 50 are down about 4 per cent each from their all-time highs of 67,927.23 and 20,222.45 respectively, which they hit on September 15 this year.
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Also Read: Nifty 50, Sensex drop by about half a percent each: Five key reasons for the market fall - explained
Meanwhile, crude oil prices fell over a per cent on concerns over weak demand. Brent crude traded over a per cent lower near the $90 per barrel mark around 4 pm.
The rupee fell 4 paise to close at 83.24 per dollar.
Top Nifty 50 gainers today
Shares of Adani Enterprises (up 3.23 per cent), Nestle India (up 3.03 per cent) and Eicher Motors (up 1.63 per cent) ended as the top gainers in the Nifty index.
Top Nifty 50 losers today
Shares of Axis Bank (down 4.72 per cent), SBI (down 2.94 per cent) and NTPC (down 2.38 per cent) ended as the top losers in the Nifty pack.
As many as 37 stocks ended in the red in the Nifty index while 11 stocks closed higher. Two stocks - Wipro and Kotak Mahindra Bank - ended flat.
Sectoral indices today
Barring Nifty IT (up 0.30 per cent) and Nifty FMCG (up 0.22 per cent), all sectoral indices ended with losses.
With a loss of 2.83 per cent, the Nifty PSU Bank index emerged as the top loser, followed by Nifty Realty (down 1.73 per cent), Media (down 1.72 per cent) and Healthcare (down 1.69 per cent).
Nifty Pharma (down 1.40 per cent), Auto (down 1.30 per cent) and Metal (down 1.06 per cent) also fell over a per cent each.
The Nifty Bank index fell 0.98 per cent while the Private Bank index declined 0.99 per cent.
Experts' views on markets
Shrikant Chouhan, Head of Research (Retail) at Kotak Securities underscored that overseas investors are pulling out funds from Indian equity markets as the current rally in US dollar and bond yields is making emerging market assets less attractive.
Despite our strong macroeconomic growth performance, India is not insulated from global problems, and hence any correction in global markets due to worries over further rate hikes would have a rub-off effect here, Chouhan said.
Vinod Nair, Head of Research at Geojit Financial Services pointed out that strong US job data is reinforcing the Fed's hawkish stance and multi-year high US bond yields are signaling an impending interest rate hike.
Nair further said that globally, investors are adopting risk-averse strategies due to inflation concerns and the strengthening US dollar. And in India, despite a robust economy, premium valuations of midcaps and recent rallies are augmenting consolidation.
"Interest-rate-sensitive sectors like real estate, banking, and metals are the most impacted category, while the FMCG sector is more optimistic in expectation of near-normal monsoon and festival demand. Auto is consolidating amid mixed growth numbers and in this weak period, large-caps are safe to hold," said Nair.
Technical views on Nifty 50
Jatin Gedia, Technical Research Analyst at Sharekhan by BNP Paribas said the zone of 19,320 – 19,360 is a crucial support for Nifty as multiple parameters in the form of the daily lower Bollinger band and the ‘20 week’ moving average are placed.
"The hourly momentum indicator is on the verge of providing a positive crossover which is a buy signal indicating that the fall is likely to halt and the probability of a pullback increases. In terms of levels, 19,330 – 19,300 is the crucial support zone while 19,520 – 19,560 should act as an immediate hurdle zone," said Gedia.
Chouhan pointed out that the Nifty has formed a Dragonfly Doji candlestick formation which indicates a strong possibility of a relief rally from the current levels.
"For day traders, 19,380 would be the key support level to watch out, above which the index could see the pullback rally to 19,500-19,550. On the flip side, below 19,380, the selling pressure is likely to accelerate and the index could slip to 19,330-19,300,” said Chouhan.
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